Are developers warming to affordable housing?

Plus: Renderings of N.C.'s first sportsbook; Another baffling CMS move; 'Plaza Shamrock' is apparently a Charlotte neighborhood now

Good morning! Today is Monday, August 5, 2019.

Need to subscribe? Sign up for free here (charlotteledger.substack.com). Like what you see? Forward to a friend.

Challenged to step up by the city, developers are including plans for cheap apartments in their projects

You’ve probably heard that Charlotte leaders consider affordable housing to be a big crisis in the city. As Charlotte grows, rents are rising.

Developers catch a lot of flack on the issue. Many are building pricey apartments while leaving city government to figure out strategies to build and preserve places for low-income residents to live.

Message received: Some developers, though, are receiving the message that affordable housing is an important issue to city leaders, and they are including affordable apartments as part of their plans they submit for city approval.

The latest example is in Ballantyne, where developer Northwood Office said last week that it plans for 8% of its new apartments, or 176 units, to be affordable for people making 80% of the area’s median income. It’s part of a proposed redevelopment of a golf course that will include shops and offices.

Developers who are asking the city to rezone their land are increasingly proposing that their projects include a small amount of affordable housing. The city is not supposed to consider prices of proposed housing when considering developers’ plans – but some developers want to be in tune with the city’s priorities.

In 2016, when Crescent Communities said it planned to include 124 affordable apartments as part of its massive “River District” development on the Catawba River, Mayor Vi Lyles said: “Everyone’s going to be included from the very beginning. That’s a message to every developer in this city. Make it a part of your plan, not an add-on to what you’re doing.”

That’s just what some developers are now doing. The planned Brooklyn Village development around uptown’s Marshall Park, for instance, is set to have 10% of its apartments affordable for those at 80% of area median income. Smaller developments, often close to the center city, also occasionally include affordable housing components.

Why they are doing it:

  • The cynical view is that developers want officials to approve their plans.

  • The charitable view is that developers recognize the community need and are responding to it.

Russell Fergusson, a lawyer who represents developer Cohab LLC, which is planning three affordable units as part of a 35-unit development on Siegle Avenue between Plaza-Midwood and uptown, tells the Ledger that developers want to help solve the problem.

Quote: “There are multiple good reasons to include affordable housing,” Fergusson says. “First and foremost, there is a need for it and there’s an ability to do that. There’s an opportunity for for-profit companies to include affordable housing units. … It’s a way to minimize the impact of development.” Cohab’s rezoning application is pending.

The issue can be legally tricky. The city is not supposed to consider the prices of proposed housing as part of a rezoning, and it cannot insist that developers include affordable housing as part of a rezoning request – even though that is often the preference of policymakers. But if the developer just happens to submit a project that includes affordable housing, well, that seems just swell with everybody.

‘Fine line’: At the same time, city planners are searching for creative ways to reward developers who propose affordable housing. According to minutes of last month’s planning commission meeting, city Planning Director Taiwo Jaiyeoba said: “We are walking that fine line by trying to achieve what we know is the right thing to do but at the same time, not creating a rule for someone to say we are making this mandatory.” He said it’s a challenge but that “we will get there.”

Bottom line: This all sounds a little bit like pushing developers to include affordable housing in their projects – even when there’s no legal ability to force them to. But more developers are playing along and helping to address a critical need. Expect to see more of it.


Business titans take sides in 9th Congressional race

We have more names for you of prominent Charlotte business types who are sinking money into local political campaigns.

In partnership with WFAE’s ace political reporter, Steve Harrison, the Ledger examined the donor lists of Republican Dan Bishop and Democrat Dan McCready, who are facing off in one of the most high-profile elections this fall, the 9th Congressional race.

(Sign up for Steve’s weekly newsletter, Inside Politics, here.)

McCready’s big donors include:

  • former Bank of America CEO Hugh McColl ($2,000)

  • Lincoln Harris CEO Johnny Harris ($1,000)

  • BofA Charlotte market president Charles Bowman ($2,000)

  • Red Ventures CEO Ric Elias ($2,000)

  • former Charlotte Observer editor Jennie Buckner ($4,300)

  • Five lawyers at Robinson Bradshaw (total of $7,600)

Bishop’s heavy hitters include:

  • Speedway Motorsports CEO Marcus Smith ($2,800)

  • Former Piedmont Natural Gas CEO Thomas Skains ($2,500)

  • Coke Consolidated CEO Frank Harrison ($5,600)

  • Car dealership owner Felix Sabates ($2,700)

  • Six executives of Charlotte Pipe & Foundry (total of $13,400)

To check out the full list of Charlotte donors who gave more than $1,000 in the second quarter, go here.


Tweet of the day: ‘Plaza Shamrock’

From Sam Spencer, chairman of the Charlotte-Mecklenburg Planning Commission, who spoke with the Ledger for a recent piece on new Charlotte neighborhood names:


Behold: Renderings of first N.C. sportsbook

You’ve never seen renderings like this before — because there has never been anything like this before in North Carolina.

Harrah’s Cherokee Casino released renderings last week of the new sportsbook it is building in Cherokee, about three hours west of Charlotte. It will be called “The Book.” It will be the first legal sportsbook in North Carolina.

Gov. Roy Cooper signed a bill into law in July that allows casinos on Indian reservations to offer wagering on sports and on horse races. Harrah’s says those operations should be up and running by “late fall” — in other words, before the end of football season.

Sports, recliners, gambling: Wagering on sports and off-track horse racing will be allowed in Cherokee and in Murphy at existing Harrah’s casinos. Unlike Vegas, though, there will be no free drinks for bettors: N.C. law forbids it.

Another CMS personnel head-scratcher

Score one for the consistency of the Charlotte-Mecklenburg school board: its hiring decisions are as baffling as its firing decisions.

On Friday, the board named Earnest Winston as permanent superintendent. For the last couple weeks, Winston had been the acting superintendent, following the suspension and forced resignation of previous CMS leader Clayton Wilcox. The board refused to provide any reasons for Wilcox’s ouster and claimed — wrongly — that it has no ability to disclose what’s up with the guy in charge of educating 150,000 of our kids. (The plain text of North Carolina law allows the board to release personnel information. The Ledger pointed that out three weeks ago, and several legal scholars cited by the Observer echoed that assessment.)

He’s nice, but is he qualified? By all accounts, Winston, age 44, is a nice guy. But also by all accounts, his qualifications as an educator and manager appear thin. Here’s WFAE’s Ann Doss Helms, Charlotte’s wisest and most-experienced education reporter:

The move is striking for its speed — coming less than three weeks after Superintendent Clayton Wilcox was abruptly suspended with no public explanation — and for the board’s decision to tap an administrator with little schoolhouse experience and no advanced degrees. …

Until July 15, when the board suspended Wilcox and asked Winston to step in, Winston supervised 26 people as chief engagement officer and ombudsman. He has a bachelor’s degree in journalism, started his professional life as a newspaper reporter and spent two years as an English teacher at Vance High.

He’s never been a principal or earned an advanced degree in school administration, the normal state requirements for leading a district. But he has worked in central offices since 2008 and served as a top aide to four superintendents, including Wilcox. Although Wilcox never named a deputy, he had told the board that Winston was among three top staffers whom they could consider as a direct line to his office.

Now Winston takes charge of a staff of 19,000, a $1.5 billion budget and the responsibility for educating roughly 150,000 students. The state Board of Education authorized the board to hire Winston, using an alternative path to superintendency based on five years of relevant “leadership or managerial experience.”

Mmm-hmm.

The board signed Winston to a three-year contract worth $280K a year. The stated reason was that the board wanted to spare the community yet another long and anguishing national search. But the speed of the Wilcox departure and Winston ascension also smack of a desire to put this troublesome episode in the rearview mirror and move past lingering questions about the board’s competence and transparency and the quality of its legal advice.

Bypassed: In selecting Winston, the board surely bypassed dozens of assistant superintendents, principals and other administrators with more traditional credentials in favor of a guy with two years of classroom experience who has since mostly been an aide to prior superintendents (several of whom were ousted by the CMS board). How do you think other top administrators are feeling about his selection?

Maybe Winston is the right guy for the job. Maybe he has intangibles that can’t be measured by academic degrees. Maybe his lack of traditional educational leadership experience is a plus. Maybe there are examples of his making unpopular decisions and telling unpleasant truths because it was the right thing to do. It’s a big job filled with plenty of conflict. We’ll see how a widely acclaimed nice guy fares. We should all wish for the best.

Editor’s note: I worked with Earnest Winston in the early ’00s when we were both Charlotte Observer reporters. I didn’t know him well, but my recollection is he was a nice and friendly guy. His brief career at the Observer was undistinguished, and he soon left to go into teaching. Every single one of Winston’s old Observer colleagues I have spoken to in recent days is shocked — shocked — that the person we knew as an unremarkable cub reporter was just named superintendent. Of course, the qualities of a great reporter and a great school superintendent are very different.


Reader response

Time to look at the ol’ digital mailbag. Have a comment? Write to editor@cltledger.com.

In response to “Panthers stadium idea draws support”:

  • “Wonder why a ticket tax on the stadium isn’t on the table?”

  • “People who speak up against the stadium are very opinionated. But they also don’t understand how certain taxes work.”

  • “Tax subsidies for a multibillionaire. If it’s a good ‘investment,’ why would Tepper want to share it? Easy to raise taxes on hotels. Outsiders who stay there cannot vote out the locals. Locals who use hotels are misbehaving and therefore will not raise a peep.”

In response to “Ballantyne developer plans grocery store, affordable housing in town center”:

  • “I thought the idea behind all of this was to attract ‘millennials.’ It won’t.”

  • “Affordable housing = tax breaks for them. Still excited and curious as to how this is gonna go. Traffic already suckssss.”

  • “Ballantyne needs more grocery stores like Myrtle Beach needs more Eagles stores.”

  • “Yay, more overcrowding in school!! (Said no one ever)”

In response to “Let’s see that Clayton Wilcox personnel file”:

  • “It f—ing drives me bananas — I’m saying totally g—damn nuts — when reporters, and you see this all the time with national media on Trump stuff, don’t follow through to press officials on answering questions they could answer. Love that you offered guidance in your story on CMS.”

  • “LOVE your call for accountability on CMS information disclosures. Love it. I hope the Observer and WFAE and others take note.”

  • “Good job familiarizing the last people standing at the Observer with the state’s open records law. I see today’s front page mentions the exceptions to the law that you reported on first.”

In response to “Charlotte soft-drink victory: Sun Drop to be bottled here”:

  • “I’m really bummed that us Gastonians are losing Sun Drop to Charlotte.  Not sure if the ‘old Gastonia flavor’ is a good thing or not.”


In brief:

  • FTC Equifax pullback: Remember that $125 the Federal Trade Commission said you could receive if you were the victim of the Equifax data hack? Well now it turns out the true amount will be far less than $125 because so many people have filed claims, the FTC said last week. Washington Post asks: “Did someone forget to do the math?”

  • Are e-scooters polluters? A new N.C. State study concludes that “e-scooters may be greener than most cars, but they can be less green than several other options.” That’s largely because scooters are collected and redistributed using cars.

  • Wells shrinking in San Francisco: Wells Fargo is moving to a smaller building in San Francisco, where it is headquartered, part of a downsizing of finance jobs in the city as tech has gained supremacy. The Wells workforce has dropped 10% in the Bay Area in the last five years, and affordable housing is scarce. “Wells Fargo’s biggest job center is now Charlotte, with 26,000 employees.” (SF Chronicle)

  • Federal investigation: Charlotte-based Sealed Air, the maker of Bubble Wrap, disclosed on Friday that it received a grand-jury subpoena from federal prosecutors related to its selection of its independent audit firm. The company fired its CFO in June and has previously said it is also under investigation by the Securities and Exchange Commission. Investors don’t seem worried, though: Company stock is up 26% on the year. (Observer)

  • Reparations for redevelopment? Activists are pressuring the developer of 17 acres surrounding uptown’s Marshall Park to offer reparations to black residents who were forced out of the area in the 1960s and ’70s. The NAACP and some religious leaders want “displaced residents from the old Brooklyn neighborhood or their descendants to receive affordable housing, retail business space and other repayment” from developer Don Peebles, whose company, BK Partners, was chosen by the county to build a mix of housing, offices and retail space, the Observer reports.

  • Charlotte satire: “Elevation Church Debuts Water Slide Baptismal” (The Babylon Bee)


Taking stock

Unless you are a day trader, checking your stocks daily is unhealthy. So how about weekly? How local stocks of note fared last week (through Friday’s close), and year to date:

Tough week for stocks — more trouble ahead?

From CNBC:

With new risks from trade wars, stocks head into the final weeks of summer vulnerable to a pull back or even correction.

The market was down sharply in the past week, buffeted first by disappointment over the Fed’s more hawkish-than-expected policy outlook. Then they were beaten down by fears President Donald Trump is starting a new front in the trade wars with China that is unlikely to end any time soon.

“The real issue as to why there’s going to be a correction in our view is there’s a massive, massive vacuum here,” said Julian Emanuel, head of equity and derivative strategy at BTIG. “In essence, it’s a month and a half of a vacuum, if you think about the direction of the rhetoric. ... The issues are China, the issues are the Fed and the issues are Brexit.”


Got a news tip? Think we missed something? Drop me a line at editor@cltledger.com and let me know.

Like what we are doing? Feel free to forward this along and to tell a friend.

The Charlotte Ledger is an e-newsletter and web site publishing timely, informative, and interesting local business news and analysis Mondays, Wednesdays, and Fridays, except holidays and as noted. We strive for fairness and accuracy and will correct all known errors. The content reflects the independent editorial judgment of The Charlotte Ledger. Any advertising, paid marketing, or sponsored content will be clearly labeled.

The Charlotte Ledger is published by Tony Mecia, an award-winning former Charlotte Observer business reporter and editor. He lives in Charlotte with his wife and three children.